The budget committee of Suppar Company collects the following data for its San Miguel Store in preparing budgeted income statements for May and June 2020. 1. 2 Sales for May are expected to be $1,200,000. Sales in June and July are expected to be 5% higher than the preceding month. Cost of goods sold is expected to be 75% of sales. Company policy is to maintain ending merchandise inventory at 10% of the following month's cost of goods sold. Operating expenses are estimated to be as follows: 3. 4. Sales salaries $30,000 per month 6 % of monthly sales Advertising Delivery expense Sales commissions 2 % of monthly sales 5 % of monthly sales Rent expense $5,390 per month Depreciation $910 per month Utilities $710 per month Insurance $560 per month 5. Interest expense is $2,000 per month. Income taxes are estimated to be 30% of income before income taxes. Your answer is partially correct. Prepare the merchandise purchases budget for each month in columnar form. SUPPAR COMPANY San Miguel Store Merchandise Purchases Budget For the Months of May and June, 2020 May June Budgeted Cost of Goods Sold 120000 126000 Add : Desired Ending Merchandise Inventory 94500 99225 Total 214500 225225 Less: Beginning Merchandise Inventory 90000 i 94500 i $ Required Merchandise Purchases 124500 $ 130725 e Textbook and Media Your answer is partially correct.. Prepare budgeted multiple-step income statements for each month in columnar form. Show in the statements the details of cost of goods sold SUPPAR COMPANY San Miguel Store Budgeted Income Statement For the Months of May and June, 2020 May June Sales 1200000 1260000 Cost of Goods Sold 90000 94500 Beginning Inventory Purchases Cost of Goods Available for Sale ION TOUTE Less Ending Inventory Cost of Goods Sold Gross Profit Operating Expenses Sales Salaries 30000 30000 Advertising 72000 75600 i Delivery 24000 25200 Sales Commissions 60000 i 63000 Rent 5390 i 5390 i Depreciation 910 i 910 i Utilities 710 710 i Insurance 560 i 560 Total Operating Expenses O FO Income from Operations Interest Expense 2000 i 2000 i Depreciation 910 910 i Utilities 710 710 Insurance 560 560 i Total Operating Expenses Income from Operations Interest Expense 2000 2000 i Income Before Income Taxes 100 Income Tax Expense Net Income /(Loss) $